Green Tech Co. Eyes NY Lawsuit Against Major Meatpacker

Clean beef technology firm Bion Environmental Technologies Inc. (BNET:OTCQB) is watching closely after the attorney general in New York filed a lawsuit accusing the world's largest meatpacker of lying about its environmental credentials to consumers.

Letitia James has sued Brazilian company JBS' U.S. division, saying it misled buyers with its plan to reach net-zero carbon emissions by 2040, The Wall Street Journal reported.

"When companies falsely advertise their commitment to sustainability, they are misleading consumers and endangering our planet," James said in a statement. "JBS USA's greenwashing exploits the pocketbooks of everyday Americans and the promise of a healthy planet for future generations."

The lawsuit shows the need for a way to independently verify marketing claims by companies to avoid such accusations of "greenwashing," Bion Senior Vice President of Capital Markets Craig Scott said.

Technical Analyst Clive Maund has rated Bion "a Strong Buy here for all time frames."

"Bion's technology and the strategic partner approach it supports will provide transparency to the consumer, up and down the value chain," Scott said. "It will also benefit the stakeholders in the supply chain with meaningful change backed by third-party verification."

Bion's Ammonia Recovery System (ARS) was developed to process and treat livestock waste streams with a focus on discharges from anaerobic digesters. The ARS is at the core of the company's Gen3Tech technology, which produces renewable energy and clean water from livestock waste streams, and removes the ammonia and stabilizes and repurposes it into low-carbon and organic nitrogen fertilizers using only the compounds in the waste stream itself. This keeps ammonia out of the air, land, and water and saves the resource from being lost. It can then be used as an organic fertilizer, adding significant value to help offset treatment costs.

The Catalyst: Is Meat With Zero Emissions Possible?

The lawsuit cites a full-page ad JBS USA took out in The New York Times in 2021 that had the line: "Agriculture can be part of the climate solution. Bacon, chicken wings, and steak with net-zero emissions. It's possible."

According to The Journal, the BBB National Programs' National Advertising Division has asked JBS to stop making the claim, saying the company doesn't have a plan to deliver on it.

The lawsuit said beef has the highest total greenhouse gas emissions of a major food commodity, and its production is linked to large-scale deforestation, The Associated Press reported.

Environmentalists also have been opposed to JBS' planned listing on the NYSE, the AP noted. A bipartisan group of senators also wrote a letter asking the SEC to closely scrutinize JBS' environmental record.

The AP reported that about half of JBS' nearly US$80 billion in yearly revenue comes from the United States, and about a quarter of it comes from Brazil. It has the ability to process more than 200,000 cattle, 500,000 hogs, and 45 million chickens a week.

JBS Disagrees With Lawsuit's Claims

A company spokesperson told The Journal that the company disagrees with the lawsuit.

"JBS will continue to partner with farmers, ranchers, and our food system partners around the world to help feed a growing population while using fewer resources and reducing agriculture's environmental impact," read a statement emailed to The Journal by spokesperson Nikki Richardson. "Our belief that American agriculture can help sustainably feed the world is undeterred."

New York's lawsuit asks the court to require the company to end its "Net Zero by 2040" campaign and seeks civil penalties of up to $5,000 per violation, The Journal said.

New ways are being developed to detect dangerous or problem air emissions worldwide. The nonprofit Environmental Defense Fund just this month launched its "MethaneSAT" satellite to measure methane emissions, USA Today stated.

"The (US)$88 million spacecraft . . .  will use the data in part to 'name and shame' large-scale polluters, including oil-and-gas drilling companies, large livestock operations, and even landfills, along with the governments that are supposed be regulating them," USA Today's article noted.

Sustainable Beef Within the Next Two Years

Bion said it is leading the charge to produce truly sustainable beef at scale within the next two years.

Producing a sustainable cut with the flavor and texture the consumer expects from U.S. beef requires new methods of production. That's where Bion comes in.

Its Gen3Tech system treats waste from indoor finishing facilities, where cattle are grain-fed, and the vast majority of U.S. beef is produced, reducing pollution and upcycling it into valuable fertilizer products, clean water, and renewable energy. Cleaning up the finishing facility is the lynchpin in a sustainable value chain. Bion said indoor barns, coupled with its Gen3Tech platform, represent the most advanced, efficient, and cleanest production possible in the beef industry today.

Organic nitrogen fertilizers will create new revenues for the producers and opportunities for the agriculture industry by allowing excess nitrogen to be transported and precision-applied where it is needed, Bion noted.

Cattle feeders and producers can also create more value for their commodity through premium pricing by having a sustainable brand that would be backed up by Bion's technology and third-party verification, the company noted.

In January, Bion announced it was issued a new patent to broaden its ARS technology to include industrial and municipal wastewater streams.

"The timing of this patent couldn't be better," Bion Chief Executive Officer Bill O'Neill said at the time. "It underscores the broad applications of our ammonia recovery technology. We've already seen results at Fair Oaks that demonstrate we can configure the ARS for the economics of industrial waste streams. It's an opportunity that could both jumpstart and shorten our drive to commercialization and give us a stronger platform to launch our sustainable beef initiatives."

Bion is operating a commercial-scale demonstration facility in Fair Oaks, Ind., extracting and producing ammonia distillate and ammonium bicarbonate, pure nitrogen fertilizers, in several concentrations.

Technical Analyst Clive Maund has rated Bion "a Strong Buy here for all time frames" when he reviewed the stock in August 2023. He said indicators pointed to a price breakout and steep rally.

"This stock has the characteristic of making sudden dramatic rallies that are then followed by long periods of reaction," added Maund.

Ownership and Share Structure

According to Reuters, nearly 22% of Bion Environmental is owned by management and insiders. President and General Counsel Mark Smith has the most out of this category at 10.12% with 5.69 million shares. 

About 1.25% is with Centerpoint Corp. with 0.70 million shares. Less than 1% is held by institutions, such as Howard Capital Management Group LLC, with 0.10%. The rest is with retail.

Bion has a market cap of US$62.33 million. Trading over the past 52 weeks ranged from US$0.86 per share to US$1.90.

Important Disclosures:

1. Bion Environmental Technologies Inc. has a consulting relationship with an affiliate of Streetwise Reports, and pays a monthly consulting fee between US$8,000 and US$20,000.
2. As of the date of this article, officers and/or employees of Streetwise Reports LLC (including members of their household) own securities of Bion Environmental Technologies Inc.
3. Steve Sobek wrote this article for Streetwise Reports LLC and provides services to Streetwise Reports as an employee.
4.  This article does not constitute investment advice and is not a solicitation for any investment. Streetwise Reports does not render general or specific investment advice and the information on Streetwise Reports should not be considered a recommendation to buy or sell any security. Each reader is encouraged to consult with his or her personal financial adviser and perform their own comprehensive investment research. By opening this page, each reader accepts and agrees to Streetwise Reports' terms of use and full legal disclaimer. Streetwise Reports does not endorse or recommend the business, products, services or securities of any company. 

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